Statement re New Company

RNS Number:0694L
Kobe Steel Ld
14 May 2003

NEWS RELEASE



                                                                Kobe Steel, Ltd.
                                                   Tokyo Stock Exchange No. 5406

                                                         Shinko Pantec Co., Ltd.
                                              Osaka Securities Exchange No. 6299


      Kobe Steel to combine environmental businesses into new company


TOKYO (May 14, 2003) - Kobe Steel, Ltd. and subsidiary Shinko Pantec
Co., Ltd today agreed to combine Kobe Steel's environmental business into Shinko
Pantec on October 1, 2003.  This move will consolidate the management resources
of the environmental businesses of the two companies into one unit and further
strengthen the Kobe Steel Group's comprehensive environmental solutions
business.



The two companies announced on March 18 they would combine their environmental
businesses in January 2004.  However, after further consideration they decided
to move up the plans due to the advantages of a combined business and confidence
that the business will expand and further grow.



The corporate split and merger procedure will be used to combine the businesses,
with Shinko Pantec becoming the continuing enterprise.  Shinko Pantec will be
renamed Kobelco Eco-Solutions Co., Ltd.  The new entity will become the main
company in the Kobe Steel Group for the environmental business.



The two companies have operated their businesses separately and each have
specialized menus.  Kobe Steel's business is centered on wastewater treatment,
including sludge incineration and municipal solid waste incineration.  Shinko
Pantec has strong experience in water and sewage treatment, industrial
wastewater treatment, and ultrapure water generation equipment.  From both the
public and private sectors, it has received high evaluations in the water
treatment field.



To date, the environmental business has consisted of supplying equipment to
users.  However, private finance initiatives, private-sector operation of public
facilities, and other changes to meet new needs are increasing.  In response to
a rapidly changing market and technologies, the two parties decided to combine
their technical capabilities, marketing and business know-how to develop the
environmental solutions business.



Through this consolidation, in the water treatment field Kobelco Eco-Solutions
would be able to strengthen its development of advanced treatment and sewage
reduction technologies.  In waste treatment, expanding into new business areas
- including PCB and dioxin treatment, soil decontamination, PVC
recycling, and biomass utilization - will enable Kobelco Eco-Solutions'
comprehensive environmental business to further grow.









Profile of the New Company

Name:                  Kobelco Eco-Solutions Co., Ltd.

Head office:           Kobe, Hyogo Prefecture, Japan

Paid-in Capital:       6 billion yen

President:             Yasuaki Hirata (Current president of Shinko Pantec)

Employees:             Approximately 800



Business Plans for the New Company



Vision

* A business based on water treatment and waste treatment technologies that
contributes to creating a recycling society

* A stable and highly profitable business that forms the core of Kobe Steel's

environmental solutions business



Strategic Business Areas

1. Water supply and sewage systems, leachate treatment, pure and ultrapure water
generation, industrial and wastewater treatments

2. Waste treatment (municipal solid waste incineration, recycling)

3. New businesses (soil decontamination, PVC recycling, PCB treatment, biomass
utilization, other new businesses)



Numerical Goals (in billions of yen)


        Non-consolidated             Fiscal 2002        Fiscal 2003         Goal (in 5 years)
Sales                                    23.9               47.0                  80.0
Ordinary income (loss)                  (1.2)               1.0                    6.0


          Consolidated               Fiscal 2002        Fiscal 2003         Goal (in 5 years)
Sales                                    27.4               51.0                  100.0
Ordinary income (loss)                  (1.2)               1.0                    8.0

(Figures in parentheses denote losses.)



*  The fiscal 2003 forecast consists of Kobe Steel's environmental sales in the
second half of fiscal 2003 and the full-year forecast for Shinko Pantec.

*  In five years, sales from new businesses are expected to make up roughly 15%
of total consolidated sales.



Media Contact:



Gary I. Tsuchida                        Tel  [phone]
Communication Center                    Fax  [phone]
Kobe Steel, Ltd.                        E-mail [e-mail]
9-12 Kita-Shinagawa 5-chome             Web site:  www.kobelco.co.jp/index_e_wi.htm
Shinagawa-ku, Tokyo 141-8688
Japan

Investor Relations:
Tel [phone]


                      This information is provided by RNS
            The company news service from the London Stock Exchange
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